A Preview of the 2012 Economic Report of the President
The Economic Report of the President has been prepared annually by the Council of Economic Advisers since 1947. The theme of this year’s Economic Report of the President is “To Recover, Rebalance, and Rebuild.” In 2011, the Nation continued to recover from the Great Recession and to make progress toward building a stronger foundation for more balanced and sustainable economic growth in the future.
The problems that caused the deep recession that began at the end of 2007 and lasted until mid-2009 were a long time in the making, and will not be solved overnight. But economic progress is being made. In 2011 the Nation continued to recover, rebalance and rebuild a stronger, more secure future. The economy has expanded for 10 straight quarters. As a result, by the third quarter of 2011, the real gross domestic product (GDP) of the United States had surpassed its peak level at the start of the 2007–09 recession.
When President Obama took office on January 20, 2009, the U.S. economy was contracting at an alarming rate, and employment was falling by more than 700,000 jobs a month. The plunge in economic activity was even deeper than the Bureau of Economic Analysis initially reported: revised estimates show that the economy contracted at an 8.9 percent annualized rate in the last quarter of 2008, from the initial advanced estimate of 3.8 percent. This was the largest quarterly downward revision ever reported.
Upon taking office, the Obama Administration immediately took bold steps to turn around an economy in free fall. It worked to stem the economic and financial collapse and put people back to work through the American Recovery and Reinvestment Act of 2009 (the Recovery Act), and it shored up the banking system and stabilized the financial sector through a series of measures including stress tests for banks and rigorous requirements for banks to raise private capital and repay the government for funds from the Troubled Asset Relief Program, and it rescued the American auto industry.
Soon after the Recovery Act was passed, the contraction of GDP slowed markedly to -0.7 percent in the second quarter of 2009 from -6.7 percent in the preceding quarter. Economic growth turned positive in the third quarter of 2009, and the economy has grown at an annualized growth rate of 2.4 percent over the past 10 quarters. Private sector employment has grown for 23 straight months, and employers have added a total of 3.7 million jobs in that period.
Sustaining and strengthening the ongoing recovery remains a top priority for the Obama Administration, while seeking to address the fundamental imbalances and other problems that had built up for decades and erupted with the financial and economic crisis in 2008. Additionally, strengthening and expanding the middle class and reforming the financial sector, are at the root of the Obama Administration’s strategy to reestablish an economy that is built to last.
To read the entire Report, click HERE.